Market News

Soybeans reclaim some of the recent losses

 

Soybeans were higher on commercial and technical buying, along with the strength in soybean meal, bouncing off the recent multi-year lows. The trade’s monitoring U.S. crop weather, with flash flooding recently reported in some areas and continued dry conditions in others. Trade tensions with China are also a factor. Soybean meal was sharply higher on commercial buying, while oil followed meal and beans higher. Additionally, bean meal could benefit from the European Union tariff on corn. Argentina’s Ag Ministry pegs soybean production at 37.2 million tons, up from the prior projection, but below initial estimates following inclement weather during development and harvest. The trade is also keeping an eye on continued transportation issues in Brazil.

Corn was fractionally mixed in consolidation trade. Corn was also watching U.S. crop conditions and the European Union tariffs on U.S. corn and other goods are now officially in effect. Near term, the crop conditions look good overall, but some forecasts do have a potential heat ridge forming in the Midwest in late June/early July. Mexico and Panama both bought U.S. corn, mostly for new crop delivery. Mexico bought 131,300 tons, 30,000 for 2017/18 and 101,300 for 2018/19, and Panama picked up 117,000 tons, all for 2018/19. Ethanol futures were lower. According to reports, the EPA plans to increase the biofuels mandate in 2019. Argentina’s Ag Ministry estimates corn production at 42.4 million tons, slightly higher than the last guess.

The wheat complex was modestly lower on profit taking and technical selling after the recent gains. Drought conditions in parts of the U.S. Plains improved slightly last week and the winter wheat harvest is ongoing in most of the major U.S. growing areas. Most of the spring wheat crop is in very good shape. Global production is expected to be down slightly on the year because of possible weather related downward adjustments for the Black Sea region and Australia, but conditions in most of the world look good, for now. European firm Agritel estimates Russia’s wheat crop at 67.4 million tons, down 21.5% from last year’s record crop because of generally poor growing conditions. The Philippines purchased 220,000 tons of optional origin feed wheat.